The decision to stick with the 401C for the R wasn't a cost issue, it simply wasn't part of the requirement. When originally developed in the mid-1990s, the LAMPS MkIII Block II upgrade was primarily intended as a SLEP to keep a consolidated Seahawk fleet (consisting of reman'd Bs and Fs) flying until 2015, the focus being on mission equipment.
The M actually derived from the L+ effort, not the X (aka FUR, for which a 3K engine was planned). Being again a mid-1990s project, the L+ was conceived long before 6K/95 became a requirement, hence the minor power improvement offered by the 701D. The more significant improvement offered by the 701D is in terms of engine life, the result of a joint effort by GE and CCAD.
There is one section of the Hawk community already benefitting from a more powerful engine: SOCOM's new MH-60Ms are equipped with the 2,600 shp FADEC-equipped T706-GE-700 (CT7-8B5). There are no plans at this time to migrate the T706 to the vanilla UH/HH-60M (Block I retains the 701D, with the Block II intended to jump straight to a 3K class engine in the shape of the GE3000 or HPW3000).
I/C